Why Are Futures Trading Fees So High?

Many fans who trade futures have complained to me about the outrageous fees. When you think about it, there are indeed several reasons for this.

First, the size of the position has a significant impact on the fees. Fees are not based on how much capital you invested, but on how much you are holding. Simply put, the more positions you hold, the higher the fees will be.

The difference between market orders and limit orders. A market order is when you actively seek to execute an order that someone else has already placed, which consumes market liquidity and makes trading less active, resulting in higher fees. For ordinary people placing market orders, the fee rate can be as high as 0.05%. On the other hand, a limit order is when you place your own order and wait for someone else to buy or sell, which adds some vitality to the market, and exchanges naturally prefer this, so the fee rate is lower, at only 0.02%. This comparison shows that the cost of market orders is significantly higher, so we need to be mindful when trading.

Don't forget about the exchange's rebate policies. Why do some people have such low fees? It's because they prefer to use limit orders and they can also receive a rebate on trading fees. Every time they open a position, a significant amount of money flows back into their pockets, and over time, the savings can add up.

In the future, when we trade futures, we need to learn to control our positions, choose the right order types, and pay more attention to the exchange's rebate activities.

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